Retail, wholesale Indian sugar prices drop further

Retail and wholesale sugar prices continued to decline on Wednesday, even as mills found few takers for their offers priced over ₹4,400 a quintal.

Industry sources said mills struggled to sell sugar on poor demand and the market will drop further tomorrow. Mills will be under pressure, as under the new fortnightly sale quota regulations, they have to sell 40 per cent of the allocation made by the Food Ministry in the first week.

Data from the Department of Consumer Affairs’ Price Monitoring Division showed that the all-India average price of sugar declined further to ₹62.57 a kg. However, in places such as Andaman, it was selling at ₹75.

Wholesale prices declined by ₹100-200 a quintal, with the rates in Mumbai being the lowest at ₹5,200, followed by Hyderabad at ₹5,300. Among other cities, prices in Chennai were the highest at ₹5,900.

Meanwhile, in another initiative, the Food Ministry asked all sugar mills to provide details of sugar sold between August 20 and 25 by Thursday (September 3). They have to specify the volume and price too.

Sugar prices have been heading southward since August 21, when the Centre permitted duty-free import of 1 million tonnes of raw sugar until October 31. As part of its efforts to control sugar prices, which soared over ₹70 a kg in the third week of August, the Centre also changed the monthly sale quota allocation to fortnightly. It has stipulated that 40 per cent of the allocation will have to be sold in the first week and the rest in the second week.

Besides, it carried out inspections on traders’ premises in different States to check hoarding, monitored physical stocks with mills and cut the stock limit for bulk buyers (who purchase over 10 tonnes a month) to 15 days of their requirements and for traders to 200 tonnes, except for those in Kolkata and the North-East.

To add further pressure, the government allocated 13 lakh tonnes of sugar for sale in the first half of September. Besides, 3-3.5 lakh tonnes of sugar meant for exports are being diverted to the domestic market.

On Wednesday, global sugar prices on InterContinental Exchange, New York, surged to 18.26 cents a pound ($402.5/tonne). Spot prices were 18.38 cents ($405/tonne). In London, white sugar prices were $528 a tonne.